Kolkata: Panic buying of bridal jewellery has started across India after Prime Minister Narendra Modi asked consumers to avoid buying gold for a year as part of austerity measures to mitigate the effects of the Gulf war on the Indian economy.
Jewellers said customers are rushing to buy ornaments before any policy changes ahead of the wedding season that starts in June and will continue until the middle of August. Sales are mostly driven by fears of higher import duties, an increase in goods and services tax (GST), or tighter restrictions on gold purchases.
“In the last two days, sales of bridal jewellery are up 15%-20% compared with average daily sales,” said Rajesh Rokde, chairman of the All India Gem & Jewellery Domestic Council.
On average, daily sales for large jewellery chains can touch about ₹25 lakh per store, while mid-sized jewellers typically see ₹15 lakh to ₹18 lakh in daily sales, industry executives said.
The All India Gem & Jewellery Domestic Council is seeking a meeting with the Prime Minister’s Office to discuss the issue.
“Our objective is to present long-term solutions that can make India self-reliant by channelising idle household gold into the formal economy rather than depending heavily on imports,” Rokde said.
The buying frenzy has spread beyond immediate wedding demand, with customers advancing purchases planned for later this year.
“Some are even buying for weddings in the November-December period as they are confused that the government might ban gold buying,” said Varghese Alukkas, managing director of Joy Alukkas, which has 65 stores in the five southern states.
In Mumbai’s Zaveri Bazaar, one of the country’s largest bullion and jewellery hubs, traders estimated sales have risen about 20% over the last two days.
“All sorts of rumours are going around,” said Suvankar Sen, managing Director and CEO of jeweller Senco Gold. “Some are saying import duty will go up, others are saying GST will be increased from the current 3%. This uncertainty has prompted consumers to buy bridal jewellery.”
About 60% of purchases are linked to the upcoming wedding season, while the rest are for winter functions, he said.
Demand for heavy bridal jewellery has also accelerated in southern India, according to jewellers.
The rush has revived activity in Zaveri Bazaar after an initial lull following Modi’s remarks.
“Both B2B and B2C sales are happening. There is panic buying in the market,” said Surendra Mehta, national secretary at the India Bullion and Jewellers Association (IBJA).
“Gold is deeply rooted in Indian culture. Consumers are buying bridal jewellery to avoid any future duty hike or restrictions on cash purchases.”
